Plastic continues to be volatile as packaging producers head into stormy Q4

Price volatility continues to be caused by changes in Chinese recycling policy, which is heavily suppressing the amount of export PRNs that are generated by recycling activities in China.

Historically China has produced 40-50% of our PRN requirement through PERNs (see the Plastics Market Situation Report by WRAP). Now China has indicated that they will ban waste PET from 2018 onwards, it is likely to cause disruption to the UK achieving its 2018 and 2017 targets as approximately 46% of post-consumer plastics are PET.

Although the policy won’t come into force until 2018, it will affect the final quarter of 2017 as recyclers race to get material to China before the beginning of 2018 to generate PERNs.